Foreign companies confident over investing

China authorities have responded to concerns over foreign investment by saying that foreign enterprises remained confident in investing and doing business in the country as shown by data from various sources.

This year, global cross-border direct investment dropped significantly amid the COVID-19 outbreak. Against this background, China has made significant achievements in the prevention and control of the pandemic as well as economic and social development, and the utilization of foreign investment has gradually stabilized, according to the National Development and Reform Commission.

In the period from January to August, the actual use of foreign capital added up to US$89 billion, down slightly by 0.3 percent from the same period last year. In particular, the decline in the utilization of foreign capital narrowed month by month since April, which was better than expected, said Meng Wei, spokeswoman for the NDRC.

A report by the American Chamber of Commerce in Shanghai released last Wednesday said that, despite the Trump administration’s push for US companies to reshore their operations, more than three-quarters of respondents (78.6 percent) reported no change in their investment strategy allocations, a 5.1 percent increase compared with 2019.

“COVID-19 hit the Chinese economy hard in early 2020, but the recovery was quick, especially in certain industries. American companies still see China’s consumer market as a great opportunity. China’s recent efforts to open insurance and asset management to foreign participation are also welcome,” said Ker Gibbs, the chamber’s president.

Also, according to the European Union Chamber of Commerce in China, in the areas where the chamber members are able to participate in China’s economy, they reported no significant change in plans to redirect current or planned investments elsewhere. 

Results from the chamber’s annual business confidence survey showed that only 11 percent of member companies were considering doing so, which was toward the lower end of the norm for the past decade.

“These data further indicated that foreign enterprises’ confidence in conducting long-term investment in China has not changed,” Meng said.

“For the next step, the commission will work with relevant parties to further deepen opening-up, continuously optimize the investment environment, and stabilize the long-term confidence of foreign businesses in developing in China,” Meng said.

Emphasis will be placed on implementation of the 2020 national negative list to ensure foreign and domestic enterprises are treated equally in areas beyond the official negative list.

The commission will also work on expanding the List of Encouraged Industries for Foreign Investment, which will allow foreign-invested projects in more areas to enjoy relevant preferential policies.